President Bola Tinubu has instructed the Central Bank of Nigeria (CBN) to establish a quarterly reconciliation platform with foreign airlines to resolve their outstanding funds. This directive was communicated by the Minister of Aviation and Aerospace Development, Festus Keyamo, during the African Aviation Summit in Abuja.

Keyamo also revealed three major projects: the Aerotropolis, Aircraft Leasing Company (ALC), and Maintenance Repair and Overhaul (MRO) facility. Additionally, he outlined five key focus areas to realize Nigeria's vision of becoming an aviation hub, which include infrastructure upgrades, ALC, MRO facility, and forex availability.

Furthermore, the International Air Transport Association (IATA) has condemned Nigeria for the numerous charges imposed on airlines operating within the nation.

The global trade body representing the airline industry has recently raised concerns about the federal government's lack of responsiveness to foreign airlines' challenges in repatriating their funds, which exceed $600 million.

For instance, in Nigeria, foreign airlines accept Naira for ticket sales to customers and then convert it into foreign currencies for their operations. However, they have been struggling to execute these exchanges through the official foreign exchange market due to a shortage of foreign currency resources.

This situation led to Emirates Airlines, the UAE's flag carrier, suspending its operations in the country. Airlines also responded by limiting access to their lower fare inventory for travel agents in Nigeria, preventing them from issuing tickets originating from other countries into Nigeria in an effort to address the backlog.

Travelers departing from Nigeria are charged approximately N2.5 million for economy tickets to London's Heathrow Airport. Similarly, flying with KLM Royal Dutch costs over N2.6 million, and with Virgin Atlantic, it's around N2.7 million. In contrast, travelers from countries like Ghana and South Africa, which are farther from Heathrow than Nigeria, pay between N400,000 to N500,000 for equivalent tickets.

In the same vein, Keyamo, during his speech at the event, emphasized, "Recent global events have highlighted the significant role of air transportation as a driver of economic development, a crucial engine for global socio-economic progress, a major contributor to modern society's advancement, and a vital tool for achieving the United Nations Sustainable Development Goals (SDGs).

"These events underscored the worldwide impact when international aviation was disrupted by the pandemic and other global factors. It is the vision of the current administration to establish Nigeria as the aviation hub of Africa."

"The government extends a warm welcome to significant players in aircraft leasing and head lessors to invest in Nigerian airlines, providing access to state-of-the-art aircraft. We are dedicated to enforcing contract agreements and safeguarding the rights of investors and all involved parties. Nigeria, as a signatory to the Cape Town Convention, will uphold its international obligations.

"This administration is fully committed to ensuring the availability of foreign exchange for entrepreneurs. To address this, the President has instructed the Central Bank of Nigeria to conduct quarterly reconciliation meetings aimed at resolving this matter."

"The Central Bank of Nigeria (CBN) is prepared to offer tax incentives to promote both existing and new entrants in the Nigerian Aviation Sector. I want to emphasize that my administration remains committed to providing continuous support to this industry.

"The establishment of a Maintenance Repair and Overhaul (MRO) facility is another pivotal aspect that can elevate the Nigerian aviation industry to a continental hub. Given the shortage of qualified engineers, the current government is prepared to extend full support for the establishment of world-class MROs and training organizations.

"In terms of infrastructure enhancement, this entails upgrading the Cat3 landing system at major airports, constructing a second runway in Abuja, implementing airport improvement programs through concession agreements, and collaborating with companies to transform major airports into Aerotropolis.

"As for tax incentives, the current administration is open to offering them to encourage both current stakeholders and new entrants in the Nigerian Aviation Sector."

Furthermore, Kamil Al Alwadi, IATA's Vice President for Africa and the Middle East, addressed the ongoing event and highlighted approximately 27 charges imposed on airlines by the Nigerian government. He underscored that research indicates Nigeria's top-ranking position in terms of airport charges among African nations.

He expressed concern about the constrained growth of the aviation industry in the region, particularly in Nigeria, and called upon the Nigerian government to establish a favorable environment that supports the flourishing of airlines.

In his statement, he remarked, "Our recent research revealed that the most expensive airport in Africa is Abuja, closely followed by Lagos. With these excessively high charges, Nigerian airlines face significant challenges competing with their international counterparts."

"Africa finds itself in a situation where it is unable to support its own aviation industry due to factors like expensive fuel, excessive charges, exorbitant leasing and insurance costs. It is essential for airlines to achieve financial viability. These airlines play a significant role in contributing to the country's GDP, but Nigeria must determine how to ensure their survival.

"Carriers based in Africa are projected to collectively incur a modest combined loss of approximately USD 484 million in 2023. This is primarily due to the continent's challenging operating environment for airlines, with economic, infrastructure, and connectivity issues impacting the industry's performance.

"Nevertheless, despite these challenges, the aviation sector is gradually moving towards profitability in the aftermath of the disruptions caused by COVID-19 and could return to profit as early as next year. This positive trend is driven by strong demand for air travel. As demonstrated in the second quarter of 2023, African carriers experienced one of the world's highest annual passenger traffic growth rates for two consecutive quarters, second only to the Asia Pacific region."

"Despite not having fully rebounded to pre-pandemic levels, African carriers have shown remarkable growth in the second quarter of 2023, with total traffic surging by 38.9 percent compared to the same quarter in 2022. This growth surpasses the industry-wide average for both total and international traffic. However, it's worth noting that Q2 2023 RPKs (Revenue Passenger Kilometers) were still 9.2 percent below the levels seen in the same quarter of 2019.

"While this ongoing positive performance is noteworthy, the region continues to grapple with economic challenges that significantly impact the affordability of air travel. Additionally, a range of infrastructure issues constrains capacity and hinders the establishment of consistent air services."